Joice Mujuru said the Zimbabwe People First (ZPF) party had been formed because “Zimbabwe is a broken country”.
Ms Mujuru was Mr Mugabe’s second-in-command until he sacked her in 2014 after accusing her of plotting to oust and kill him.
“I’m neither a witch nor an assassin,” Ms Mujuru said, at the party’s launch in the capital, Harare.
She is the most senior former Zanu-PF leader to form an opposition party, and is tipped to be its presidential candidate in the 2018 election.
Her supporters ululated as she entered the hall to announce ZPF’s launch, reports the BBC’s Nomsa Maseko from the scene.
Ms Mujuru, 60, was flanked by other former Zanu-PF heavyweights, including Didymus Mutasa and Rugare Gumbo.
She hailed the formation of ZPF as historic, and said it would fight the “scourge of corruption” in Zimbabwe.
“Some revolutionaries are busy pulling Zimbabwe down,” Ms Mujuru said.
Our correspondent says she was a Zanu-PF member for more than 30 years, and will it find difficult to convince voters that she represents a new era.
But, encouragingly for Ms Mujuru, her supporters turned up at the launch to give their backing, she adds.
Zanu-PF has nominated Mr Mugabe, who turned 92 last month, for re-election in 2018.
However, because of his advancing age, a battle to succeed him is raging in Zanu-PF between Mr Mugabe’s wife, Grace, and Vice-President Emmerson Mnangagwa, who was appointed to the post following Ms Mujuru’s expulsion, correspondents say.
Mrs Mugabe led the campaign to oust Ms Mujuru, who was seen to harbour ambitions to succeed Mr Mugabe as Zanu-PF leader and president.